The IRS has three mileage rates. Which one should friends use?

Why is the charity rate stuck at 14 cents?

Because Congress took it away from the IRS and never gave it back. A 2008 CRS report traces the history. Before 1985, the IRS set the charitable rate itself, “usually at the same level as the medical and moving standard mileage rate,” which reflected only the variable costs of driving. The Deficit Reduction Act of 1984 then added section 170(i) to the tax code and wrote a number into it: 12 cents a mile.

The next change took 13 years. In 1997 the Senate’s version of the Taxpayer Relief Act would have raised the rate to 15 cents and indexed it for inflation. The conference agreement set it at 14 cents, not indexed. That took effect in 1998. According to CRS, the only official reason the Joint Committee on Taxation gave for the increase was that Congress believed it was appropriate.

Sources: Charitable Standard Mileage Rate: Considerations for Congress, CRS report RL34681, October 10, 2008 (1984 and 1997 history, conference outcome); CRS Insight IN12320, 2026 (rate table, 2000 to 2026); H.R. 1582, introduced February 25, 2025.

The IRS re-sets the other two rates every year. CRS says the IRS “generally changes standard mileage rates once per year,” and the two CRS reports record mid-year increases after fuel-price rises in 2005, 2008, 2011, 2022 and 2026. The charity rate cannot follow. The IRS has no authority to change it, because the number lives in the statute itself.

How far has 14 cents fallen behind?

The obvious yardstick is general inflation, and it is the wrong one. The 2008 CRS report makes the point itself: automatic indexing to a general price index “would not be appropriate” for mileage rates, because the price of gasoline “has a history of moving independently from the general inflation rate,” and fuel efficiency changes the cost of a mile as well. The better yardstick is the one the charity rate used to equal: the IRS’s own variable-cost rate.

When Congress set 14 cents, it sat above the IRS’s estimate of what a mile of fuel, tires and upkeep cost. By 2004 the two were equal. From July 2026, 14 cents equals about 60% of that estimate, though the estimate counts a wider basket than the gas and oil a volunteer may deduct (see the caveat below). Even in the first half of 2026, before the fuel adjustment, the variable-cost rate was 20.5 cents. Against the all-in business rate, 14 cents is under a fifth (14 ÷ 76).

Meanwhile both re-costed rates have more than doubled since 1997: business from 31.5 to 76 cents, medical and moving from 10 to 23.5 cents. The charity rate has not moved since 1998.

One caveat cuts in the charity rate’s favor, and the same CRS report raises it. The IRS lets volunteers deduct gas and oil but not tires or maintenance, which the cost study counts as variable costs. CRS notes that this rule “suggests that the charitable standard mileage rate should be lower than the medical/moving rate.” So part of today’s gap may be intended. The history still points the other way: Congress set the charity rate above the medical rate in both 1984 and 1997, and CRS found no official cost basis for either number. Either way, 14 cents is a policy choice that the IRS cost study has never revised.

Why does a frozen number still feel like a real rate?

One likely reason: it is printed in the same table, by the same agency, in the same unit as the two rates that are re-costed. The IRS rate page lists all three in one short list. A reader sees “Charities: 14 cents/mile” one line below “Self-employed and business: 76 cents/mile” and could easily assume both came from the same study.

The 14 has also never changed, so no new figure invites a second look. Economists have a name for judging money by its face value instead of its purchasing power. Shafir, Diamond and Tversky’s 1997 paper defines money illusion as “a tendency to think in terms of nominal rather than real monetary values.” They propose that people “often think about economic transactions in both nominal and real terms,” and that the interaction between the two “results in a bias toward a nominal evaluation.”

Be clear about what that paper does and does not show. Its evidence is survey responses about inflation and prices; it says nothing about mileage rates. Here it supplies a possible mechanism, and the mileage numbers come from the IRS. Our reading, untested by the paper: a nominal number that stays fixed for decades may give a reader little reason to recheck it. One practical check is the yardstick above. Compare 14 cents with a figure that gets re-costed.

Which rate should friends use to split the cost of a drive?

Decide what the riders are paying for, then pick the rate that measures that cost. The IRS has already done the costing for both useful answers.

Which of the first two is fairer depends on the group and the trip, and that argument lives elsewhere. Our carpool guide covers when an all-in rate is fair for a standing commute, and the road-trip guide covers what a one-off trip’s gas leaves out. The point here is narrower: whichever answer the group picks, there is an official number for it, and the 14-cent rate fits none of them.

Sources: IR-2025-128, IRS (what each rate is based on); CRS Insight IN12320, 2026 (fixed and variable cost definitions; tolls and parking excluded).

Is there a fair rate between 23.5 and 76 cents?

Yes, and the IRS’s own figures let you build it. The gap between the business and medical rates is the fixed cost of owning the car. Notice 2026-10 says how much of the 2026 business rate is depreciation: 35 cents a mile, a figure Announcement 2026-11 left in place (“All other provisions of Notice 2026-10 remain in effect”). The rest of the fixed cost is registration and insurance.

That gives a third, defensible option: variable costs plus registration and insurance, without depreciation, or 23.5 + 17.5 = 41 cents a mile for the second half of 2026. CRS built the same kind of middle rate in 2008, when it costed options for Congress: 37.5 cents with the non-depreciation fixed costs, 48 cents with depreciation instead.

Why leave any fixed cost out? CRS records the reasoning behind the medical rate: it is unlikely that someone would buy a car “primarily for the purpose of doing volunteer work, getting to medical appointments, or moving his or her residence to locate near a new job.” Nobody buys a car to drive friends to the lake either. That is the case for the medical rate on an occasional favor. A middle rate is for groups who think the driver should not carry every cost of owning the car alone. Which fixed costs to share is a judgment call. What the IRS figures add is a published number for each piece.

Sources: Notice 2026-10, IRS, section 4 (depreciation portion); Announcement 2026-11, Internal Revenue Bulletin 2026-29; CRS report RL34681, 2008, Table 2 and notes.

What does the choice cost on one trip?

Take an illustrative 200-mile round trip in the second half of 2026: four friends, one car, and the driver counted as one of the four riders. The rate the group picks changes the bill by more than five times.

The gap between the medical and charity rows is running cost that a 14-cent split does not cover: $47.00 − $28.00 = $19.00 on this trip, by the IRS’s own standardized variable-cost estimate (a real car’s cost may differ). Split four ways, that is $4.75 a rider. The driver’s own quarter was theirs to pay anyway, so the three passengers’ part, $14.25, is what stays with the driver. That is small money between friends, and it repeats every time this group uses the frozen number.

Tolls and parking sit outside all three rows. Add them at the receipt amount and split them among the people in the car.

What about volunteer driving: the team run, the charity shuttle?

This is where the 14 cents actually applies, and even here the IRS offers it as one of two methods. IRS Publication 526 says a volunteer can deduct “unreimbursed out-of-pocket expenses, such as the cost of gas and oil,” directly related to using the car for a charity, or use “a standard mileage rate of 14 cents a mile” instead. Parking and tolls are deductible under either method. General repairs and maintenance, depreciation, registration fees, tires and insurance are not.

Read that as what it is: the rules for one tax deduction, with no claim about what volunteer driving costs. The publication lets a volunteer deduct actual gas and oil instead of the flat rate. The 2008 CRS report adds that a volunteer whom a charity reimburses has taxable income “to the extent that the reimbursement exceeds his or her deductible travel costs.” Check the current rules with a tax professional before setting a reimbursement policy.

Congress keeps returning to the gap. H.R. 1582, introduced in February 2025, would keep 14 cents for general charitable driving. For transporting other people or property on behalf of a charity, it would substitute a rate set by the Treasury that “shall not be less than the standard mileage rate” used for business. The House bill’s record lists only its introduction and referral to the Ways and Means Committee. The Senate version, S. 1177, was referred to the Finance Committee in March 2025.

Sources: Publication 526 (2025), Charitable Contributions, IRS; CRS report RL34681, 2008; H.R. 1582 text and its bill-status record on GovInfo, retrieved October 21, 2026.

Why does the choice of reference number matter so much?

Friends reach for an official rate precisely so they do not have to argue. A published, dated number from a neutral source is meant to settle the question before it becomes an argument. That only works if everyone means the same number. The IRS table holds three rates that differ by more than five times. Two people can each say “the IRS rate” in good faith and be $19 or $105 apart on the trip above.

Our road-trip guide covers the mid-year change in more detail. For the wider case for agreeing on a split rule before the costs arrive, see the hidden tax of the even split.